3 Charts to Help You Monitor Stagflation
The market is growing increasingly worried that the U.S. economy could be headed for stagflation, which is categorized by high inflation, high unemployment, and slowing economic growth. In fact, several banks (including Goldman Sachs) already believe stagflation is here.
Lawrence Summers, former U.S. Treasury secretary, also wrote in a recent op-ed column in The Washington Post that he thinks the Fed is sailing toward a period marked by recession and stagflation. Here are three simple charts that can help you monitor the U.S. economy in terms of stagflation.
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1. Consumer Price Index
The Consumer Price Index (CPI) measures the price increases and decreases of a basket of goods and services that Americans use on a daily basis. As you can see in the chart, the CPI is up close to 8% on a year-over-year basis as of February, which is the highest increase in about four…
